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G-7 summit: Leaders criticise Japan for rising trade surpluses
DENVER. June 22: World leaders lectured summit partner Japan on its rising trade surpluses, warning in tough language that the world s second largest economy must do more to stimulate demand at home, reports AP.
A nine-page draft economic document, also bemoaned record high unemployment rates in Europe but did not offer any new solutions on how to restart Europe’s stalled job machine.
The criticism of Japan and its skyrocketing surpluses echoed earlier commentary by the Clinton administration, which Is concerned that a rising trade gap with Japan will fuel Erotectionist pressures in the nlted States.
The draft statement said Japan must work toward "achieving strong domestic-led growth and avoiding a significant Increase in its external surplus." The leaders said Japan must intensify its efforts to deregulate its economy, cutting red tape that frustrates foreign nations trying to break into Japanese markets.
The economic statement also pledged an additional 300 million dollars to help Ukraine build a new concrete shell over the remains of the destroyed Chernobyl reactor, and endorsed an effort to make bribery of public officials by foreign companies illegal.
Currently, only the United States has laws against such bribery and the Clinton administration has been pushing other countries to outlaw the practice so that US firms will not be at a disadvantage in the competition for global business.
The economic session was the only meeting where Russian President Boris Yeltsin was excluded from the newly renamed Summit of the Eight. He was having an economic session all his own, meeting with US military contractors.
On the issues of jobs and prosperity, the statement praised the United States for its current booming economy but warned that officials must guard against a resurgence of inflation and must stay the course to get the federal budget
deficit under control.
While praising the US prosperity, the document was silent on the nettlesome problem confronted at this summit of how to bridge the gap between the American model of capitalism and the European model.
The United States has been tremendously successful at creating jobs, pushing unemployment currently to a 24-year low 4.8 per cent, but the Job growth has come at a cost in painful corporate restructurings and Increased worker anxiety.
Europe offers greater Job protection and a much more extensive social safety network Including generous unemployment benefits but has paid a price in unemployment that is at an all-time high of 12.8 per cent in France and is at doubledigit rates through most of continental Europe.
For France, Germany and Italy, the economic statement said those European countries "share the challenge task of restoring strong employment growth."